UPDATE 1-Brazil union recommends strikers accept Petrobras contract

RIO DE JANEIRO Nov 13 (Reuters) - Leaders of Brazil's
largest oil workers' union said on Friday they had proposed
ending a 13-day strike, the most disruptive in 20 years, at
state-run oil firm Petroleo Brasileiro SA, or
Petrobras.

The union, known as FUP, said on its website that it had
made progress on its main goal of reversing investment cuts and
blocking asset sales that the company says are necessary to
reduce its crippling debt of nearly $130 billion, the largest in
the global oil industry.

Petrobras on Thursday reported a $1.01 billion third-quarter
loss, the third loss in five quarters.

If approved by members in assemblies over the coming days,
the contract will give workers a 9.53 percent wage increase and
set up a worker-management committee to explore ways to restore
investments.

Petrobras senior executives said in a conference call on
Friday that they have set aside funds to pay for the cost of the
contract.

The committee will have 60 days to draft a report to senior
management, the board of directors and Brazil's federal
government, the company's controlling shareholder.

Petrobras this year cut about $100 billion from its
five-year investment target following a plunge in oil prices,
soaring debt and a crippling corruption scandal.

The strike, which began Nov. 1, was cutting around 115,000
barrels a day of oil output in Brazil, about 5 percent of
pre-strike output, in recent days, Petrobras said. The union has
said output cuts were as high as 400,000 barrels a day, or
nearly a fifth of output.
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